State of the Union: Bitcoin endures tumultuous weekend as Bitcoin Cash rises

Bitcoin has enjoyed a rocky weekend, facing a price drop as its spin-off coin, Bitcoin Cash, has soared to impressive new heights.

Bitcoin’s civil war reached a new escalation point this weekend, as the aftermath of Bitcoin’s canceled SegWit2x fork has given rise to a dramatic Bitcoin Cash pump – fuelling prices upwards to $2600 USD before settling at $1200 USD at the time of writing.

Bitcoin Cash, of course, was the fruit of Bitcoin’s most prolific user-activated hard fork, which saw the new cryptocurrency born amidst a wave of uncertainty in the Bitcoin community.

Many investors proceeded to sell off their Bitcoin Cash at the time of the fork, giving traders an extra $300 – $400 USD to pocket. However, those who held on to the cryptocurrency were rewarded this weekend as prices soared to new heights.

Pundits and critics have attributed Bitcoin Cash’s meteoric rise to different developments. Proponents cite that Bitcoin Cash’s 8-megabyte block size solves the scaling problem that Bitcoin’s SegWit2x hard fork was intended to fix (with potentially messy consequences), which critics have laid down their belief that Bitcoin Cash is yet another altcoin that has been the victim of pump-and-dump tactics.

‘Bitcoin Jesus’ Roger Ver has indicated his support for Bitcoin Cash.

The new Bitcoin?

Bullish investors have cited their belief that Bitcoin Cash is an alluring competitor to Bitcoin, and further that market forces attached to the push for Bitcoin’s SegWit2x fork have joined forces under the umbrella of Bitcoin Cash. The fact that other altcoins, such as Bitcoin Classic, have shut down with the view to support Bitcoin Cash has added fuel to the fire.

Jacob Eliosoff, manager of Trevi Digital Assets Fund, quipped that supporters of SegWit2x now “have nowhere to turn but BCH… It’s not surprising that SegWit2x’s loss has been Bitcoin Cash’s gain.”

Similarly, Kyle Samani, managing partner of MultiCoin Capital, wrote that “There were lots of Bitcoin Cash whales who were in early on Bitcoin who were waiting to see what would happen with 2x. Now they’re making their move. They’re dumping BTC for BCH….I know many Bitcoin OGs who have dumped $10m+ of BTC for BCH … Turns out there were a lot more BCH ideologues than we all thought.”

Roger Ver further announced his intention to depart Bitcoin markets in favour of Bitcoin Cash, offering that Bitcoin’s high transaction fees have made it an unappealing investment or means of exchange.

Pump and dump?

Critics, however, have slammed Bitcoin Cash investors as key behind a sharp pump and dump which has seen Bitcoin Cash climb as high as $2600 USD, and then plummet down to $1200 USD.

Kumar Gaurav, Chairman of Cashaa quipped that “The quick rise [of BCH] from around 600 to 2400 USD in a few days makes it look like a typical artificial pump which was already being followed by a dump back to $1300 USD within 30 min. As compared to the FX market, the crypto market is still small, it is easy to do that and can not be used to estimate the future of BTC vs BCC.”

The pump has never been more obvious, and the agenda as well. #Bitcoincash has been up 40-50% past three days, and it’s to get centralization of mining power through infinitely large blocks. No #SegWit, #AsicBoost, #EDA‘s, no #LN… Total garbage. Don’t fall for it.

Gauruv re-iterated his support for Bitcoin, citing that the cryptocurrency “has already overcome many challenges, keeps following its pattern of steady rise and its current downwards push is one of the many only temporary ones such as in July and September this year, so we can expect it to be back on the way to 8000 USD soon, whereas [BCH] is too new to estimate whether it will grow in the long term or whether the current move was one of the typical altcoins’ pump and dumps.”

No end in sight

Bitcoin’s square-off with Bitcoin Cash has resulted in a war of words winding down to terse tussles, as Bitcoin’s price reconsolidates at the $6100 USD mark. Fundamentally, the decision to indefinitely postpone Bitcoin’s SegWit2x fork has triggered a massive divergence in its loyal community, with some believing that Bitcoin’s inability to scale might lead to the cryptocurrency becoming a victim of its own success.

Charles Hoskinson, CEO of Input Output Hong Kong, elaborated in an interview with CoinTelegraph that “Bitcoin is at an existential crisis where it has grown large enough and attracted enough quality people to provide very clear yet different roadmaps for the future backed by passion, money and brilliance. From one perspective this creates friction and has resulted in splits. From another we get to see in parallel both philosophies play out in real time and compete for market share.”

“In the end, it’s impossible to say who will win, but this is predictable sign of maturity rather than a symptom of chaos. No ecosystem can keep everyone happy nor can it satisfy divergent visions. So they have to find a way to split like so many open source projects before then without destroying the value already accumulated and the underlying communities.”

The Bitcoin network remains heavily congested, with users complaining of both high transaction fees and long wait times – leaving both traders and long-term investors with mounting frustration and worry.